The Effect of China's Slowdown on World Trade

It is clear from the first chart that China's Gross Domestic Product is undergoing a slowdown.  Growth  in the first half of this year is running at 8%  over last year compared with annual growth rates of  9.25% in 2011 and 10.49% in 2010.  Because of the size of China's economy, the ramifications of the slowdown will undoubtedly be widespread and significant.  One way in which the slowdown is affecting the rest of the world is through China's imports. Its imports have declined and countries dependent on exports to China, have seen their trade balances suffer.

Haver Analytics has detailed data on imports by commodity and by country.  For example, countries in Latin America, Europe and Oceania have been major suppliers of goods to China and are now beginning to experience a slowdown in the demand for their goods.  The second charts shows the declining trend in China's imports from these areas. 

If we look at the data from the commodity viewpoint, those countries, say, exporting iron ore, steel products or crude petroleum, to name only three of the seventy plus commodities listed in the Haver's data base, are vulnerable.  The declining trend of these imports into China are shown in the third chart.